June 16, 2016

The Massachusetts House on Wednesday began debating an energy bill that would require the
state's utilities to enter into long-term contracts to buy more offshore wind
and hydroelectric power.

"This piece of legislation is historical," said
State Rep. Thomas Golden, D-Lowell, chairman of the Joint Committee on
Telecommunications, Utilities and Energy. "The House of Representatives
today will set a strong, firm foundation for the growth of a fully renewable
future."

The bill, H.4377,
would require the state's energy distribution companies to solicit long-term
contracts to purchase 1,200 megawatts of offshore wind power and 1,200
megawatts of hydropower by 2027. The distributors would be required to enter
into the contracts as long as the bids go through an evaluation process and are
found to be reasonable and cost-effective. The hydropower could be combined
with other renewable energy sources, such as solar energy.

Golden said if the bill becomes law, Massachusetts will be
procuring approximately 20 percent of its electric load from renewable sources.

"This is the largest procurement of clean energy that
the commonwealth has ever seen," Golden said.

Golden said the procurement of offshore wind will not only
provide clean and carbon free energy, but may also "provide an economic
boost" to Massachusetts by creating new jobs. Multiple energy companies
have proposed plans to develop offshore wind farms off the coast of Martha's
Vineyard.

The State House News Service reported that the latest
version of the bill, released by the House Ways and Means Committee, would
allow utilities to charge ratepayers a fee to recoup some of the costs of
getting the renewable energy, such as building a new transmission line. The fee
would be capped at 2.75 percent of the company's annual payments for the cost
of the new infrastructure.

Key state senators have already said they do not believe the bill
is comprehensive enough because it does not include energy efficiency measures.

Numerous interest groups have criticized the bill.

The New England Power Generators Association says the bill
would increase costs for consumers by locking part of the Massachusetts
electricity market into long-term contracts. The Conservation Law Foundation,
an environmental group, is disappointed that the bill focuses on hydropower
rather than onshore wind or other renewable energy sources such as solar
energy.

George Bachrach, president of the Environmental League of
Massachusetts, said in a statement Wednesday that the bill "has taken a
small step forward to bring online our massive offshore wind energy resources,
but there's much more work to be done." The Environmental League of
Massachusetts wants to see the state procure 2,000 megawatts of offshore wind
power, rather than 1,200. It also wants to see more energy procured from local
sources, such as New England-based onshore wind, and the permanent elimination
of a cap on reimbursements for solar energy projects.

State representatives have introduced more than 50
amendments that will be debated during Wednesday's House session.

House Speaker Robert DeLeo, D-Winthrop, predicted that
"what you see coming out will be a little bit different than what you see
coming in."

But DeLeo said the bottom line will be about increasing the
use of hydropower and offshore wind power. Addressing concerns that the bill
would raise energy costs, DeLeo predicted that the bill would result in better
prices by creating competition.

Gov. Charlie Baker, a Republican who introduced his own bill to expand the use of
hydroelectric power, said the House bill will give Massachusetts energy
purchasers the ability to not take bad deals.

Baker stressed that Massachusetts is losing 10,000 megawatts
of power over the next five years as older power generating stations are
retired. "We need to replace it with something, or we're going to be at
the mercy of the world market, and we'll probably be buying a lot more dirty
fuel than we would be buying if we pursue a more diversified portfolio,"
Baker said.

If the bill passes the House, it will still need to be
debated and passed by the Senate.

Baker said he hopes to sign an energy bill into law before
the legislative session concludes at the end of July.